They may never be safe long-term bets, but they will continue to offer asymmetric payoff opportunities—for better or worse. While GameStop and AMC once again grabbed headlines, the 2025 meme surge included a more diversified list of names. Tupperware, BlackBerry, Nikola, and Faraday Future saw dramatic gains, but with varied levels of staying power. New entrants like TruthSocial (following its volatile public debut) and struggling AI startups also joined the meme mania club. What begins as a joke or protest can evolve into a full-scale social media stock surge, turning obscure tickers Forex free margin into trending topics.
- If you’re a retail investor caught between FOMO and fear, the best approach is clear-eyed risk management.
- The prices can be highly volatile, driven by sentiment rather than fundamentals.
- They embody hope, rebellion, speculation, and storytelling—all wrapped into ticker symbols and candlestick charts.
- Fueled by viral communities on Reddit, X (Twitter), and Discord, meme stocks turned investing into a social movement where sentiment mattered more than fundamentals.
- Here’s everything you need to know about meme stocks in 2024, including 10 of the highest trending shares.
While efforts to recreate that speculative mania of yore continue, the results have been sporadic and unsustainable, and the stock has largely languished ever since. Vanda also noted many hedge funds have learned from 2021 and are likely better prepared for short squeezes today. AMC’s stock closed Tuesday at $6.85 and has risen 135% since Friday, but it’s a far cry from its all-time highs above $300 set in June 2021. This written/visual material is comprised of personal opinions and ideas and may not reflect those of the Company. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions.
PLATFORMS AND TOOLS
Get the latest insights & exclusive offers delivered straight to your inbox. Prices rarely reflect actual company performance, so predicting direction becomes nearly impossible. This sense of unity fuels participation and reinforces trading psychology factors tied to confidence and identity. When excitement dominates rational thinking, demand inflates instantly, creating sharp upward momentum followed by equally abrupt drops. Super Micro also offers data storage solutions and server management software.
The stock market is in the thick of another meme stock frenzy, sparked by Sunday night’s online return of one of the key figures of the 2020 and 2021 craze that sent GameStop (GME) shares to record highs. Even when trades don’t go as planned, meme stocks can teach valuable lessons about volatility, timing, and emotional discipline. Observing these dynamics helps new investors understand how sentiment affects market prices. The meme stock movement has encouraged more people, especially younger retail investors, to learn about the stock market, trading psychology, and risk management.
Both companies generate genuine excitement on social media while delivering measurable business results. The retail enthusiasm becomes self-reinforcing when backed by growing revenues and improving margins. As long as online communities exist, there will be room for social media stock surges tied to collective excitement. Allocate no more than a small percentage of total capital to speculative stock movements that rely on online sentiment. The meme stock definition generally refers to a stock whose demand is fueled by online attention rather than fundamentals. The original meme stock, GameStop is one of the world’s largest video game retailers, selling video games, gaming consoles, accessories and collectible merchandise.
AMC and Other Viral Stocks
More recently, the stock has slumped about 37% from the 52-week high of $35.81 it hit in late May. Even so, the retail chain and e-commerce business is still a fan favorite in the stock trading chatrooms and blogs. Join us for expert opinions, stock analysis, and economic insights, designed to help you navigate the complexities of investing in today’s dynamic markets. Meme stocks remain a recurring feature of the market, flaring up during windows of excess liquidity, social media coordination, or unusual market catalysts.
The longer their valuations stay inflated without earnings to back them up, the more vulnerable they are to collapse when retail sentiment fades. For meme stocks to transition from speculative trades to legitimate long-term holdings, they need to show some level of operational improvement. GameStop’s efforts to shift toward e-commerce, AMC’s experimentation with crypto and live events, and Palantir’s push into government AI contracts are all attempts to build real businesses.
One was the pandemic and its attendant lockdowns, which prompted people deprived of social contacts and customary entertainment pursuits to fill their empty hours day-trading stocks. Internet influencers goaded their followers into trading in concert with the goal of putting it to the Man — i.e., rich Wall Street hedge fund managers who were shorting unloved stocks and deserved to be taken down a peg. The stock had surged by more than 1,400% in the four days through Oct. 22, when shares hit an intraday peak of $7.69, up from a low of 50 cents on Oct. 16. After seeing some investors bragging on Wall Street Bets about getting winning trading advice from ChatGPT, we decided to test the AI’s knowledge of the market’s speculative frenzy. GameStop has the financial stability to attempt a genuine transformation, though the clock is ticking on proving it works.
Here’s ChatGPT’s advice on how to spot the next meme stock
Their cultural and financial relevance means they can move broader markets and even influence regulatory frameworks. Understanding their behavior is key to managing risk in a modern, internet-fueled market. Following the events of 2021, regulatory bodies like the SEC pledged to review the mechanics of meme stock trading. There’s growing concern over gamification, social media manipulation, and the risks posed by 0DTE options. While no sweeping reforms have yet been implemented, discussions around market volatility and retail investor protection are heating up again in Washington.
The company faces a crushing $8.6 billion debt burden while generating negative free cash flows—a combination that would terrify any rational investor. CEO Adam Aron has diluted shareholders into oblivion, increasing the share count by 610% since 2020 through aggressive equity raises that kept the lights on but destroyed long-term value. The easy money phase of meme stocks is over, but opportunities remain for smart traders. While some investors may experience substantial gains in a short period, there’s also significant risk of losing money.
If that same company announces a partnership or beats earnings while social sentiment is positive, you might have found your next multi-bagger. If you’re already hearing about it from your barber or seeing it trending on Twitter, you’re probably too late. You can now track which stocks are gaining momentum before they break out, monitor institutional response in real-time, and even predict which direction the retail army will march next. Gone are the days when a single Reddit post could move a stock 400%.
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Learn how a gamma squeeze magnifies volatility and fuels extreme price spikes. Here’s everything you need to know about meme stocks in 2024, including 10 of the highest trending shares. But those investors seldom have the resources to survive the almost inevitable snapback.
- Learn how a gamma squeeze magnifies volatility and fuels extreme price spikes.
- With the companies’ profits declining, a number of large hedge funds had taken up short positions on these companies, essentially betting that their business models would eventually fail.
- The economic fundamentals underlying the overall stock market don’t seem to have much to do with meme stock rallies.
- Jennifer is an SEO content writer with five years of experience creating clear, engaging articles across industries like finance and cybersecurity.
- AMC is a pure momentum play for traders who understand they’re betting on sentiment, not business prospects.
Supporters view meme stock participation as offering legitimate opportunity alongside risk, suggesting that traders can capture genuine gains when properly timing their entries into these volatile securities3. In 2025, retail traders are using zero-day options (0DTEs) at unprecedented rates. These short-dated contracts offer massive upside potential for a small premium, turning stocks like GameStop into volatility-driven slot machines. When millions of traders buy bullish call options, it forces market makers to hedge by purchasing the underlying stock—creating a gamma squeeze that drives prices even higher.
What is a meme stock, and why did names like GameStop and AMC shake Wall Street? These are stocks that soared not because of earnings or innovation, but because the internet decided they would. Then, as if out of nowhere, the stock got noticed by online investment promoters, who urged followers to buy GameStop shares to hurt Wall Street short sellers, who were betting that the stock would keep falling. The emblematic meme stock of 2021 was GameStop, a spavined mall-based video game retailer that was struggling through the transformation of its franchise from brick-and-mortar stores to online commerce. The company had lost a combined $1.36 billion from 2018 through 2020, and its future looked bleak.
GameStop has been one of the biggest winners of the frenzy this week, along with AMC Entertainment (AMC). Those and other meme stocks have shot higher following the online return Sunday of one of the prominent drivers of the earlier meme craze. They work best as small, short-term trades, not as part of a core investment strategy. It sparked interest among young investors, pushing them to learn about trading psychology factors, risk, and strategy, skills that can serve beyond the next viral trade. While risky, meme stocks can offer unique advantages for certain investors, especially those who understand how momentum trading works and can act quickly.